Dynamic paint does not work on canvas in paint mode
I had this same problem, then stumbled on the solution after watching ~10 tutorial videos.
Solution: The &quot;+&quot; button needs to be pressed, next to &quot;Paintmap Layer&quot; item, under &quot;Physics &gt; Dynamic Paint &gt; Output&quot; menu.
Before:

After:

Also make sure that you have an &quot;Attribute&quot; node feeding into &quot;Base Color&quot; in the Shader node tree for your canvas object, with the name of the the &quot;Paintmap Layer&quot;, like so: